Friday 11 February 2022

Implement quantitative risk analysis

Quantitative risk analysis is usually performed after the quantitative analysis process, but is not a necessary step. sometimes, the development of an effective risk response strategy does not require quantitative risk analysis, which is related to time, whether the budget is available, necessity, etc.

 


1. quantitative risk analysis: 

analyze the risks that are ranked first as potentially significant impacts on project needs in the process of qualitative risk analysis (quantitative method). the quantitative analysis process is to analyze the impact of these risk events and assign a numerical value to the risk. experienced risk managers sometimes perform quantitative analysis directly after the risk analysis process (skipping qualitative analysis).

 

2. ito details of quantitative risk analysis:






(1) data collection and display technology: obtain some opinions on the project duration, cost or other opinions through interviews, and form a completely objective summary analysis. the possibilities are demonstrated through probability distributions.

(2) quantitative risk analysis and modeling techniques: techniques for modeling the numerical value of risk, as detailed below.

 

3. quantitative risk analysis techniques include (this is where the focus needs to be understood):


(1) sensitivity analysis: determine which risks have the greatest potential impact - tornado chart



(2) expected monetary value (emv) analysis: used to calculate the average result when risk occurs and does not occur. positive numbers indicate opportunity, and negative numbers represent risk. emv = ∑ (result value * probability of occurrence), as shown in the following figure


(3) decision tree analysis: solve the emv of each scheme, as shown in the following figure




(4) models and simulations (monte carlo techniques: modeling simulation techniques, stochastic simulation methods, without the need for expert participation), each uncertainty translates into a probability distribution of potential impact on the target. as shown in the following figure



 

4. the output of the implementation of quantitative risk analysis

 is the update of project documents, mainly the update of risk registers. risk registers are formed during the risk identification process, are updated in qualitative risk analysis, and are further updated during quantitative risk analysis. updates at this point include:

(1) probabilistic analysis of the project

(2) the probability of achieving cost and time targets

(3) quantify the risk priority list

(4) trends in quantitative risk analysis results

 

the results trend from repeated quantitative risk analyses can reveal whether risk management measures need to be increased or decreased. it is a basis for the risk response planning process. the next section explains in detail how to plan for risk response.

No comments:

Post a Comment